CEO power and tax avoidance: An empirical study of manufacturing companies in Indonesia

Anugrah Pamungkas Wijil Zunianto; Niluh Putu Dian Rosalina Handayani Narsa; Carolyn Lukita

doi:10.14414/tiar.v14i1.3700

Vol. 14 No. 1 (2024), Articles

Vol. 14 No. 1 (2024)

CEO power and tax avoidance: An empirical study of manufacturing companies in Indonesia

Articles

DOI: 10.14414/tiar.v14i1.3700

Published 2024-06-08

Anugrah Pamungkas Wijil Zunianto⁺⁻
Niluh Putu Dian Rosalina Handayani Narsa⁺⁻
Carolyn Lukita⁺⁻

Anugrah Pamungkas Wijil Zunianto

Universitas Airlangga, Surabaya, Jawa Timur, Indonesia

Niluh Putu Dian Rosalina Handayani Narsa

Universitas Airlangga, Surabaya, Jawa Timur, Indonesia

Carolyn Lukita

Universitas Singaperbangsa Karawang, Karawang, Jawa Barat, Indonesia

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Keywords

CEO power
Cash effective tax rate
Effective tax rate

How to Cite

Zunianto, Anugrah Pamungkas Wijil, et al. “CEO Power and Tax Avoidance: An Empirical Study of Manufacturing Companies in Indonesia”. The Indonesian Accounting Review, vol. 14, no. 1, June 2024, pp. 11-23, https://doi.org/10.14414/tiar.v14i1.3700.

This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.

Abstract

This study aims to empirically examines the relationship between CEO power and tax avoidance. The lack of consistent empirical evidence regarding the relationship between CEO power and tax avoidance strategies encourages a deeper investigation into the mechanisms underlying this relationship. This study examines various aspects of CEO power and their impact on tax avoidance, thereby providing a more detailed under-standing of these complex interactions. The sample used in this study is 301 manufac-turing companies listed on the Indonesia Stock Exchange (IDX) for the period of 2015-2019. The data obtained are analyzed using SPSS version 20 software with multiple linear regression analysis. The results of this study show that expert power and prestige power have a positive relationship with tax avoidance, while ownership power has a negative relationship with tax avoidance. It is expected that this study provide theoretical benefits as a reference and knowledge for further research and practical benefits that are useful for the Directorate General of Taxes to formulate policies to reduce the risk of tax avoidance.

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CEO power and tax avoidance: An empirical study of manufacturing companies in Indonesia

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